GE Capital to Acquire Franchise Finance

GE Capital Corp. agreed to buy Franchise Finance Corp. of America for $1.4 billion in cash, expanding its lending to such chains as Burger King, 7-Eleven and Midas Muffler. The world’s biggest non-bank financing company, a unit of conglomerate General Electric Co., will pay $25 for each Franchise Finance share and assume $700 million in debt in the deal. Shares of Franchise Finance rose $1.20 to close at $24.92, while GE closed up 46 cents at $41.86, both on the NYSE. Scottsdale, Ariz.-based Franchise Finance, which has provided loans and other credit to 6,200 properties in the U.S. and Canada, will operate as a separate unit within GE Capital Commercial Equipment Financing’s subsidiary. No date has been set to complete the transaction. The company provides lease financing, loans, acquisition and construction financing, equipment loans and tax-deferred exchanges. Stamford, Conn.-based GE Capital has more than $370 billion of assets.